City council approves 5.7% tax increase, wants education levy split from property tax

Edmonton city council finalized the municipal property tax increase at 5.7 per cent Wednesday, while council members pointed fingers at the province for an increase in its education tax. 

Council passed a motion on Wednesday to have city administration work with Alberta Municipalities to explore how to separate the provincial education tax collection from municipal property tax. 

The motion was put forward by Coun. Michael Janz and passed 9-4 with Tim Cartmell, Sarah Hamilton, Karen Principe and Jennifer Rice voting against the motion. 

The motion initially included another directive that Mayor Amarjeet Sohi send an invoice to the Alberta government for the entire education property tax collection cost but it was struck from the motion before the final vote. 

"We frequently get told to stay in our lane, and I'm growing increasingly frustrated that we are, as municipalities, kind of the proverbial punching bag," Janz told council.

"We've been advocating for the province to pay their grants in lieu of taxes. We've been advocating for the province to pay a number of things that are costs that we bear for them." 

Education tax

In Canada, public education is the responsibility of provincial governments. 

The provincial education portion of property taxes, about $98 per month or 25 per cent of the total property tax bill for a typical single detached property, goes to fund schools in Alberta, according to the City of Edmonton. 

The municipal and provincial education taxes change at different rates each year, and are added together to make up the total tax amount property owners must pay.

The tax makes up 29 per cent of the education operating budget. But the provincial government has said it wants to raise the tax so it would make up 31.5 per cent of that funding in fiscal 2025 and 33 per cent in fiscal 2026. 

Sohi said he wants the financial breakdown to be clear for Edmontonians. 

"The principle should be, the government responsible for taxing people should be sending them the bill to collect that tax, not another order of government," Sohi said. 

"We are required to collect taxes on behalf of the province that directly go to the province, but city council gets the blame for that tax, particularly at a time when people are struggling with the affordability crisis." 

A spokesperson for Municipal Affairs said city council was "trying to distract from the fact that they continue to raise their own property taxes.

"Municipalities have collected education property taxes for over thirty years, and this continues to be the case," said Kevin Lee, press secretary for Alberta's Minister of Municipal Affairs, in an emailed statement.

Lee said the province is restoring the education property tax to previous funding levels to address growing enrolment pressures.

Tax increase

With the 5.7 per cent increase, a homeowner will pay about $763 in municipal taxes in 2025 for every $100,000 of assessed home value, an increase of $51 from 2024.

The median assessed value for a home in Edmonton is $465,500 this year, which would have a $3,550 bill in annual property taxes.

"Eighty per cent of the services that people consume on a daily basis are delivered with that $3,550 that we collect to run a municipality. But people don't make that distinction, that one-quarter goes to the province," Sohi said. 

Property taxes in 2025 will generate more than $2.2 billion to fund the 70 city services, including parks, trails, roads, bridges, transit, recreation centres, attractions, emergency services and social supports.

The 5.7 per cent increase is lower than the 6.1 per cent increase that council approved in December.

Council's motion will be brought forward as a resolution during Alberta Municipalities's fall convention this year. 

Tax notices will be mailed to property owners on May 23 and taxes are due June 30.